Trump's budget director defends plans to cut social programs

Elias Hubbard
May 26, 2017

President Donald Trump's first budget proposal, snubbed by some Republican allies, is just the latest example of an administration that seems at times clueless or indifferent toward Congress. Such voodoo economics were proven wrong long ago, as President George H.W. Bush finally acknowledged in going back on his "no new taxes" pledge in order to fix the mess President Ronald Reagan had left him. Revenues are roughly the same, minus $1 trillion to do with repealing taxes related to Obamacare.

Trump proposes to completely eliminate funding for lots of other programs. But critics said that would come at the cost of cuts in the billions of dollars to Medicaid, nutrition, environmental and farm programs, and more.

True to its word, the Trump administration released its 2018 budget that includes a notable change for drug and device makers - they would face a stiff increase in so-called user fees that industry pays for to fund product reviews conducted by the Food and Drug Administration.

Sen. Claire McCaskill (D-Mo.) said the White House budget would cripple rural areas of her state by reducing Medicaid funding for hospitals and skilled nursing centers, in locales where Trump received overwhelming support last November. Sen. That slight decrease adds up to more than 600 billion United States dollars over 10 years. Overall, the blueprint calls for $3.6 trillion in spending cuts over the next decade, with large chunks of that from health care spending for low-income populations. "So I think [Lawrence Summers], I think in all fairness to him, the issue is more of this is a preliminary document that will be refined, as we go through a process with Congress determining how money is spent".

Presidential budgets should be read as statements of political ideology, not determinations for what will ultimately become law.

Those economic assumptions are a refreshing departure from the Obama administration, which relied on pie in the sky economic growth forecasts in its budgets following the financial crisis.

The proposed budget will also impact the Department of Education's yearly budget from $68.2 billion in 2017 to $59 billion in 2018, a 13.5 percent decrease. "When these entitlements kick in in the out-years, what are you supposed to do?" As usual, if we do have another recession, it will require a commensurate robust recovery to balance out.

The Trump budget would make America ugly and unfair to average families. Based on what we know so far, the plan could cost $3 to $7 trillion over a decade - our base-case estimate is $5.5 trillion in revenue loss over a decade.

Like many economists, Sanford cited the long-term decline in the growth in the labor force as a major headwind to economic growth.

Early on, the administration's botched rollout of Trump's immigrant travel ban caught Republicans off-guard and scrambling to get basic information for their constituents.

Which, is how a conservative budget ought to be drafted, Americans for Limited Government's Manning contended, concluding, "the President takes nothing for granted, and should find willing allies amongst the Congressional GOP as their once in a generation opportunity to achieve an historic agreement on rational spending priorities moves forward". He has put his name on a budget which will make it harder for our children to get a decent education, harder for working families to get the health care they desperately need, harder for families to put food on the table, harder to protect our environment, and harder for the elderly to live out their retirement years in dignity.

Other reports by Click Lancashire

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